More than 600 debenture holders packed Kyabram P-12 College hall to hear McGrathNicol partner Tony McGrath update them on the receivership process and answer questions from the floor.

Meetings were also held at Shepparton and Ballarat.

Banksia Securities, a subsidiary of Kyabram-based non-bank lender Banksia Financial Group, went into receivership on October 25 owing $660million to about 15000 investors — many from the Goulburn Valley.

Investors’ moods at Kyabram yesterday were polite but forceful in demanding answers to why the company collapsed, who was to blame and how much of their money they could expect back and when.

Mr McGrath said the company’s failure could be traced back to the start of the global financial crisis ‘‘three, four, five’’ years ago, and its lending practises had not kept pace with changing market conditions.

Questions were raised about the expense of the receivership process and the necessity of sending out high-gloss reports to each account holder, with some households receiving more than one report.

Mr McGrath said it was a matter of balance.

‘‘We have to weigh up costs against getting information out. We are required to post this,’’ he said.

Asked later about $1.6million in receivership costs over the past seven weeks, Mr McGrath said those were the terms of McGrathNicol’s engagement.

‘‘On balance, I’m comfortable with the way we charge,’’ he said.

Other investors asked if Banksia directors were still being paid.

Mr McGrath replied it depended on whether the holding company they worked for was still active.

Asked why the directors did not attend yesterday’s meeting, Mr McGrath said ‘‘it was their call not to be here. I didn’t especially invite them’’.

Mr McGrath said he was ‘‘very confident’’ investors would eventually receive between 50 and 65 cents in the dollar.

Banksia Securities investors have already received an initial distribution of 20 cents in the dollar.

One woman asked why her parents had not received any payment from another failed Banksia Financial Group fund, Cherry Fund Ltd.

A receivers and managers’ report predicted Cherry investors could expect 55 to 70 cents in the dollar.

Mr McGrath replied that Cherry investments were mostly tied up in a separate company called Banksia Mortgage Fund, which was still being administered by directors.

‘‘I do not have control over Banksia Mortgage Fund ... it’s a stand-alone entity,’’ he said.

Mr McGrath later said ‘‘there were some issues around the stand-alone mortgage fund, with investors’ money being siphoned into that fund’’.

Asked about the possibility of legal action against directors and auditors, Mr McGrath said it was early days.

‘‘We all need to be better informed before anyone can make that decision,’’ he said.

He said he was hopeful that 75 per cent of receivership matters could be resolved by September next year.

‘‘But these things do play out over a period — some assets might take another year or two to finalise,’’ he said.

Mr McGrath said there was a ‘‘high degree’’ of engagement with state and federal governments concerning the Banksia collapse.

He also said McGrathNicol was in ‘‘constant dialogue’’ with the Australian Securities and Investments Commission about Banksia Securities.

At least 300 people, largely older or retired, attended a meeting in Shepparton yesterday afternoon where investors criticised Banksia directors and auditors and also questioned the costs of the receivership management.

Some asked receivers McGrathNicol how they could organise a class action.

They were told the receivers would not stand in the way of any action taken by debenture holders.To read about the reaction of Banksia Securities Ltd debenture holders who attended the meeting pick up a copy of today’s Weekend News.